Antitrust Law Daily Wrap Up, ANTITRUST—N.D. Cal.: CRT manufacturer in price-fixing action compelled to produce documents maintained in France, (Oct 24, 2014)

By Linda O’Brien, J.D., LL.M.

In a lawsuit by direct action plaintiffs against cathode ray tube (CRT) manufacturers for an alleged international price fixing conspiracy, a French CRT manufacturer was compelled to produce certain documents relating to the alleged price-fixing conspiracy that the manufacturer maintained in France, according to the federal district court in San Francisco. Thus, the defendant’s objection to a special master’s recommended order was denied, and the plaintiffs’ motion to compel production of documents was granted (In re Cathode Ray Tube (CRT) Antitrust Litigation, October 23, 2014, Conti, S.).

Electronic products manufacturer Sharp Electronics and other direct action plaintiffs (DAPs) elected to opt out of multidistrict class action litigation against cathode ray tube manufacturers for an alleged international price fixing conspiracy. The DAPs moved pursuant to the Federal Rules of Civil Procedure to compel production of documents held by defendant Thomson in France that were relevant to Thomson’s communications with competitors, aspects of Thomson’s CRT business, and documents produced to various foreign regulatory agencies prior to the CRT price fixing investigations, including those produced to the European Commission.

A special master recommended that the DAPs motion to compel be granted. The DAPs subsequently moved for similar discovery through the issuance of letters of request for international judicial assistance in the production of documents. Defendant Thomson filed an objection to the special master’s recommended order.

Motion to compel. The Federal Rules of Civil Procedure authorize discovery of evidence that is relevant to a party’s claims or defenses; however, the courts have discretion to limit discovery on several grounds, including international comity. The court found that the DAPs’ motion to compel should be granted, rejecting Thomson’s argument that the French Blocking Statute barred the discovery process from French nationals and evidence located in France. The court noted that comity and foreign law alone were not dispositive when a discovery dispute arises regarding a foreign law’s protection of documents sought in a U.S. court.

Instead the court considered certain factors set forth in the U.S. Supreme Court decision in Societe Internationale v. Rogers, 357 U.S. 197 (1958) to determine whether the foreign statute excused noncompliance with the court’s discovery orders. The court found that (1) the discovery sought was highly significant to the litigation; (2) the DAPs lacked an alternative means of obtaining much of the information; (3) strong national interests of the United States were at play; and (4) the risk of prosecution by Thomson for violating the French Blocking Statute was minimal.

Letters of request. The court declined to deny the DAPs’ motions for the issuance of letters of request as likely moot, following the grant of their motion to compel. In addition to their requests for various documents in their motion to compel, the DAPs sought to depose former Thomson employees in France who were potential participants in alleged CRT conspiracy meetings. However, plaintiff Sharp was required to file a statement explaining whether it wishes to continue to pursue its motions for the issuance of the letters of request, the court concluded.

The case is No. C-07-5944-SC.

Attorneys: Stephen E. Taylor (Taylor & Company Law Offices, LLP) for Sharp Electronics Corp., and Sharp Electronics Manufacturing Company of America, Inc. Eliot A. Adelson (Kirkland & Ellis LLP) for Hitachi, Ltd., Hitachi Displays, Ltd., and Hitachi America, Ltd. Bambo Obaro (Weil, Gotshal and Manges LLP) for Panasonic Corp., and Panasonic Corporation of North America.

Companies: Sharp Electronics Corp.; Sharp Electronics Manufacturing Company of America, Inc.; Hitachi, Ltd.; Hitachi Displays, Ltd.; Hitachi America, Ltd.; Panasonic Corp.; Panasonic Corporation of North America

Cases: Antitrust CaliforniaNews